Does placing employees on furlough prevent the employer from making them redundant?

Placing an employee on furlough does not prevent the employer from making them redundant. However, for claim periods from 1 December 2020, an employer will not be able to claim under the Coronavirus Job Retention Scheme during an employee's notice period (whether statutory or contractual notice), including where they have been given notice of redundancy.

For claim periods in November 2020, HM Revenue and Customs (HMRC) guidance for employers on the Coronavirus Job Retention Scheme states that the employer can claim under the scheme for employees who are serving a statutory notice period. (There has been inconsistency in the HMRC guidance on this point as the guidance for employees states that, prior to 1 December 2020, employers can claim under the scheme while the employee is serving a statutory or contractual notice period. The guidance for employers no longer mentions contractual notice periods.)

The HMRC guidance for employers confirms that employers should follow the normal rules on notice and consultation if making furloughed employees redundant.